HM Treasury

Off-payroll review 2014-15

Lord Young of Cookham: My right honourable friend the Chief Secretary to the Treasury (Mr David Gauke) made the following Written Ministerial Statement yesterday..The Treasury has concluded its annual evaluation of departments’ compliance with the rules governing off-payroll appointments in central government for 2014-15. Specific rules implemented in 2012 require departments’ most senior staff to be on payroll, and departments now have stronger powers to seek assurance in relation to the tax arrangements of their long-term, high-paid contractors who are off-payroll. These rules do not cover other off-payroll engagements, which will include a broader category of staff and public sector organisations. Below board-level off-payroll engagements These rules apply where a new off-payroll engagement is for more than six months with a daily rate above £220. All engagements from 23 August 2012 meeting these criteria must include contractual provisions that allow the department to seek assurance that the worker is either not a disguised employee, or, if they are, that they are paying the right amount of tax and national insurance contributions. If assurance is not provided the contract must be terminated. For any individuals where their engagement has either been terminated, ended as a result of the assurance process, or ended after assurance was sought but before it was received, departments have been asked to provide personal details of the worker to HMRC for further investigation. In accordance with the guidance, departments adopt a risk-based approach in deciding which contractors to seek formal assurance from. In 2014-15, departments sought assurance on the tax affairs of 3,034 of their contractors and informed the Treasury that they received satisfactory assurances from 2,530 of these engagements. In the remaining 504 cases, contracts were either terminated or came to an end before assurance was received. Referrals to HMRC occurred in all relevant cases across government. Further details can be found in the table annexed. The review found that not all relevant contracts contained the clause required to allow departments to seek assurance. At the time of the review period the rules had been in place for over 2 years, and it is reasonable to expect departments to have these clauses in place. Departments can expect to be fined if breaches of this nature are found in the next review. Board-level and senior appointments The rules also specify that board-level appointments and those with significant financial responsibility should be on the payroll of the department or other employing body, unless there are genuinely exceptional circumstances. Any such exceptions should not exist for longer than six months. The review has uncovered two cases where there have been breaches of these rules. The Ministry of Defence and Department for Communities and Local Government have brought to my attention instances where a board member or senior official with significant financial responsibility at their arm’s length bodies remained off-payroll for longer than 6 months. Steps have been taken to resolve these breaches and, as the value of the salaries in question was considerably below the £58,200 annual rate at which Treasury monitors non-board level appointments, I have decided not to impose sanctions this time. As in previous years, the review found instances where off-payroll workers at board level or with significant financial responsibility have been seconded to the department from another organisation. Where the full value of payments from the department to the individual are put through the payroll of the seconding organisation this has not been treated as a breach of the Treasury rules. Next steps The Treasury will continue to monitor department’s compliance with these rules and will conduct a similar review for the 2015-16 financial year. The Treasury is keen to increase compliance both with the Treasury rules, and also with the ‘intermediaries legislation’ – the tax rules for disguised employees. While not directly covered by this review, the ‘intermediaries legislation’ will apply to some of the engagements covered by the Treasury rules, and the government’s overall assessment is that compliance with this legislation, across the contractor population as a whole, is only 1 in 10. A separate consultation published on 26 May 2016 proposed moving the responsibility and liability for applying the intermediaries rules from the individual to the public sector engager or agency. The government will announce the outcome of that consultation shortly.



Attached Table for Off-payroll Engagements WMS
(PDF Document, 235.17 KB)





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Department for Transport

High Speed Rail Update

Lord Ahmad of Wimbledon: My Right Honourable friend, the Secretary of State for Transport (Chris Grayling), has made the following Ministerial Statement.I would like to update the House on the progress of High Speed Two. This Government is planning for the future and investing in world class transport infrastructure to ensure that the UK can seize opportunities and compete on the global stage. In a clear signal of how work is progressing on HS2 Phase One, this morning I am announcing that the following companies have been awarded the Phase One Enabling Works contracts:Area South - CS JV (Costain Group Plc, Skanska Construction UK Limited)Area Central – Fusion JV (Morgan Sindall plc, BAM Nuttall Limited, Ferrovial Agroman (UK) Limited)Area North - LM JV (Laing O’Rourke Construction Limited, J. Murphy & Sons Limited)These contracts are worth up to £900m in total and cover the whole of Phase One. The works include archaeological investigations, site clearance and the setting up of construction compounds ahead of the start of the main civil engineering work. Today I have published a command paper, ‘High Speed Two: From Crewe to Manchester, the West Midlands to Leeds and beyond’, and accompanying maps setting out the detail of my preferred route for HS2 from Crewe to Manchester, and from the West Midlands to Leeds, with junctions onto the existing network. This is known as HS2 Phase 2b. This means that following on from the 2013 consultation and work we have done since, I am pleased today to be confirming the majority of the route. There are also a number of cases, including the proposed route through South Yorkshire recommended by Sir David Higgins in a report earlier this year, where I am proposing substantial refinements. I am launching a consultation to seek the views of communities and other interested parties before reaching a decision on those sections next year. In all, there are seven refinements on which we are consulting, these are: On the western leg: To move the previously proposed Rolling Stock Depot at Golborne to a site north of Crewe;To move the approach to Manchester Piccadilly 370 metres eastwards with the northern tunnel portal in Ardwick, to avoid direct impacts on residential properties and a school at West Gorton; and,To move the route in the Middlewich - Northwich area in Cheshire up to 800 metres westwards. On the eastern leg: To move the route to the east of Measham in Leicestershire, avoiding the most significant impacts on local manufacturing businesses and development sites;To go around instead of tunnel under East Midlands Airport;To amend the alignment of the preferred route as it passes through Long Eaton to reduce severance in the local community and reduce impacts on the highway network and existing rail infrastructure; and,To move the alignment of the route from Derbyshire to West Yorkshire to reflect a change in the proposals for serving the Sheffield city region, as recommended by Sir David Higgins in his report “Sheffield and South Yorkshire” published in July 2016. In order to ensure our case is robust we have of course considered alternatives to the Phase 2b scheme, but we have found no alternative that could deliver the same level of benefit for the country. I am also issuing Safeguarding Directions for the whole of the preferred Phase 2b route today. This protects the preferred route from conflicting development. But it also means that those people who are most affected by the plans to build Phase 2b will now be able to access statutory compensation. In addition, I will be consulting on discretionary property schemes. These will go over and above what is required by law and give assistance to those who will be adversely affected by the railway. These schemes are the same as those currently in operation for people living along the Phase One route and I aim to be able to confirm the schemes on which I am consulting for Phase 2b next year. Two of these schemes will enter into operation on an interim basis, from today, these are Express Purchase and Need to Sell. Further information on property schemes can be found at www.gov.uk/hs2 I am placing copies of the documents in the Libraries of both Houses. Following consultation I plan to make a decision on these route refinements next year and to bring forward a hybrid Bill on Phase 2b to lay before Parliament in 2019. HS2 is an ambitious and exciting project and we must seize the opportunity it offers to transform our country for future generations. The route decision I have published today takes us an important step closer to realising the full potential of HS2.



Command
(PDF Document, 8.7 MB)





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Department for Education

Higher Education and Research Bill: English Votes for English Laws

Viscount Younger of Leckie: My honourable friend the Minister of State for Universities, Science, Research and Innovation (Jo Johnson MP) has made the following Written Ministerial Statement.I am pleased to announce the publication of analysis of English Votes for English Laws in relation to Government amendments to the Higher Education and Research Bill at Commons ReportThe English Votes for English Laws process applies to public bills in the House of Commons. To support the process, the Government has agreed that it will provide information to assist the Speaker in considering whether to certify that Bill or any of its provisions for the purposes of English Votes for English Laws. The memorandum provides an assessment of tabled Government amendments to the Higher Education and Research Bill, for the purposes of English Votes for English Laws, ahead of Commons Report. The Department’s assessment is that the amendments do not change the territorial application of the Bill.This analysis reflects the position should all the Government amendments be accepted. I have deposited a copy in the Library of the House of Commons. 



Memorandum on English Votes for English Laws
(PDF Document, 432.7 KB)





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